The girl's microphone just cut off.
Uh-oh.
They'll never know what the Yahoo is.
Oh my God. What is Yahoo Mike? Yahoo.
Me?
No, do you want to answer? Go ahead.
I'd rather hear your answer first.
No, you go ahead. No, let's hear your answer first.
Listen, Yahoo's a great company that is very , very strong in content for its users, uses amazing technology to serve up what increasingly weakens the web of one. F or instance, on our today module in the front page every five minutes, we have 32,000 different variations of that module. So you don't even know what I am seeing. In fact we serve a million diffe rent front page modules a day. And that's just through content optimization, that's just the beginning.
Customize I've experienced.
...customized, because we know the things you in interested in, maybe you don't like entertainment, maybe you like a certain sports team, et cetera, et cetera, and our click-through rate went up twice. So the point is, people come to us to find out what's going on in the world in a very nice quick fashion, to do their communications through mail and messenger, check in on their teams. And we all know about Yahoo finance. It's a place where you can just get it together. OK.
It's collated for you, it's all the things that as you're moving, you can even get your social information there. But, you know, e verybody moves through many websites in a day. Yahoo is one they always stop at. OK. You had some news today that, you have partnered with match.com .
Uh-huh, that was one piece of news.
Yeah. And they are now powering your personals and you're moving your existing personal product to direct to that now.
Yes. Yes.
Why abandon such a large, a large property? Well, personals is something we, the company actually hasn't been focusing on that much for about 3 years and so to, to ramp it back up. We didn't think that actually in t he sweet spot of what we do. It's more, the same thing with HotJobs. I think, during the time when Yahoo bought, bought into both of those concepts was when the diversification seemed to be many kinds of services, instead of many kinds of content, whether it's our editorial content, our license content or now with associated user generated content.
So that people really can, especially as you get into the local part of your world, the long tail content. You really need to get that from the folks that are on on the ground there. So I gave an example the other day, I was trying to decide whether I should fly to Europe a couple of weeks ago with the cloud, you know. Not the kind of cloud we all talk about. and I checked in on YahoolFront Page and there w as an AP report, but it was 17 hours old. I FOUND 17 hour old volcano information. You know, I need real live Twitter like feeds. You know, content brought in by people there and at the airports and so forth, that's what Yahoo stands for. Personals was something off the side. Are there any other of the big yahoo properties that...?
No .
So that's it. We've now gotten rid of e verything that you're not focused on.
Right.
Everything that's left you're focused on. Right.
Okay.
What about this? I'm sorry, what was the other announcement today? It was a Nokia announcement. We did an announcement with Nokia, and they are going to be using our mail and messenger on all of their i nternet enabled handsets around the world, and we will use their map and navigation services on both mobile and PC. Are we getting feedback from Carol should have both of her mics on? Or are we good out there on audio? We're good. Okay.
How important is mobile to Yahoo! going forward? Oh, mobile is extremely important. You know, of the eighty-two thousand, eighty-two million, I'm sorry, internet mobile devices in the U.S., we're on 37 million of them with our CompStat and search, and so, we really attack the U.S. market. People don't think, they just don't think-
Yeah. -that's true, but it is.
And it's especially important in emerging, or new to the net folks, who come on through handsets. Yeah.
[unintelligible] So the very fact of the matter is, the first application most of the users in the emerging part of the world want to use is messenger, because that's how they communicate with people, their friends and so forth. So , getting messenger on the handset company that really, outside the U.S., is dominant, is really important to us.
Is that a signal, that you're partnering with NOKIA, is that a signal that you're very focused on emerging markets, lowering hand set That you didn't make announcements around higher end handsets.
W ell, we already have iPhone apps, we have rim apps, a nd our android staff will be coming out soon. So, no. It has nothing to do with that. It's just that outside of the U.S. the Hero phones are you know, the A through F phones, are still getting the dominate use. Still has to be internet enabled. But, doesn't matter. But, no this is just a way to broaden the platform.We're already have lines to the 100 oams , so whether it's the Samsungs, Nokias ...
Are there are a 100 oams?
Mm-hm. Oams and carriers, yeah.
OK. There are.
What phone do have?
What a disturbing number by the way, is that we're on like 23 hundred different handsets. I mean, it's like the old days of Unix, you know. All you're doing is pointing to different variants. What kind? I carry a Blackberry and an Iphone.
OK. No Android. No, IPhone. Hands down or up for Blackberry. Hands down, up for Android. Hands down, up for anything else.
I would like to spend a few minutes talking about your product
organization. I think that, you know, that we could talk about the financial help that Yahoo and you actually do and you I seem to be doing quite well. I would rather focus, and I think this audience is probably more interested in, is on what Yahoo is doing on a product prespective.
You made some changes in the organization and there have been some departures at the senior level, but we don't need to talk about those.
The new blood is Blakerman. Has he officially started, maybe a week ago.
Last Monday. OK, last Monday. And I, you know, I want to put this carefully, but is he the person who runs product at Yahoo now?
Absolutely. OK. Does he, is he, would you consider him a product czar? Is it through, is there a committee? Does he answer to you only? Just how does it work? When you guys sit around and talk about what Yahoo is, and is going to be at a high level. Is it his job to sort of quarter, is he quarterback? Is he, you can imagine how maybe a Steve Jobs acts within his own organization. I get the sense that Steve is in charge of product. Is he, is he that person?
Well, first of all, you know, you can't find any VP engineer, VP product anywhere that compares to Steve Jobs . So.
And I didn't mean to make that comparison.
Let's start with that as an unfair comparison. I have a Head of Labs, Prabhakar that reports to me, Blake reports to me. Under Blake there's three segments, our advertising products group, our audience products group and our platform group. we would have the largest private clouds in the world . So we do alot of count in up organizatio and platform. Audience, of course, is all of our audience based products. Then, advertising, as you can imagine,we serve up 10 billion ads a day. So, keeping out whole advertising business is enormous technical effort.
So, if there isn't a single strategy at Yahoo, is what your doing on the advertising audience platform side and what you are doing on audience.
I mean, for instance, I talked earlier about generating different on the fly thru bulk machince and editorial authorization.
The second thing that we are n the process of looking at and we are testing is optomizing page format on the fly. For instance, we know that, males have banner blindness and will actually look at ads in the lower left hand. Women like banners in the upper right hand corner. So, why should I say it nails her off. N ow that you say it, it makes more sense. Why would I ever wait, you know, the wrong position. He's so slow. You're on the page, okay why would you ever do that? And because the advertiser, you know, you don't get the click through, etc., etc., so you can optimize the page on the fly for you know teenager versus the mom whatever.
That's all great but what a bout, you know, when you think about Apple, they just launched the Ipad. They aren't really talking about I optimization is like it's the iPad it's culturally changing.
That's because that that's because the iPad is, you know, lets start with a ... let's have a couple of different concepts here. Ipad, they're a hardware company. And an apps company, and the iPad is just the natural revolution, evolution.
Sure.
Evolution of what they're doing. When we talk, its like these days in the valley if you're not coming out with a device or a plat form, then somehow your not innovating. To, to be able understand how what I'm describing works is a lot of science and it's a a lot of equations, and it's a lot machine learning.
Where's the soul?
Pardon me?
I get the science part of it. Where's the soul, the product soul? Is that, I mean. What I'm trying to understand is, is that Blake? Is Blake the, the or is he the chief scientist sort of analysing the data?
Chief scientist is Prabhakar. The product soul, the soul, listen there's not absentee jobs . Who's the products soul of a lot of other companies? It's a combination of smart people, Mike. Its not, you can't pin a company the size of Yahoo on one person's back. That doesn't make any sense.
Have you heard that you said that a combination of smart people. Have you heard the saying that a camel is a horse designed by committee?
I know that. You don't design. You don't necessarily design, but you implement by serveral people.
OK, great.
By the way, when I can just imagine there were a lot of different
there were a lot of different concepts brought up to Steve, if you want to stick with jobs.
Yeah.
I mean he doesn't sit there and say it's this and then go do it. A lot of concepts are brought forth; they're tried, they're tested, they're sent back. There are people involved.
Yeah.
It's naive to think there's not multiple people involved.
Yeah, fair enough. Okay.
Why Blake. His last job was at Pepperdine. He was a professor. Before that
he was at Microsoft.
x] He was a professior at Pepperdine because he took two years off from Microsoft.
Fair enough. In Microsoft he was with Windows Live platform.
He worked on Internet video conferencing, internet tone, mail messaging, and blogging. advertising platform.
Yep, and before that Xerox and Compaq. Is that the key, the advertising platform experience?
No male clamps advertising, internet. Yeah.
I mean that's, this is a, we're in a very new industry here. I would say most of these wonderful start ups that are shooting through here are because they have a technical background and they have a great idea they find somebody with the technical background, you know it like in the early days and Yahoo is 15 years old, you know one of the oldest, nobody knew what any of this stuff was who just came and, and and worked at it. Blake, considering all those words we talked about, advertising Internet pretty darn good fit and my style. How important is social to Yahoo? And what is social to you, what does that mean to you?
Well, back when the word social Social actually had a broad definition. In that, you are a social person which meant you liked to communicate with the people and you are outgoing.
So if you start with the fact that socialist communications, you can basically say Yahoo Finance Chat was the first social. Yeah.
So social's extremely important. When we finally put out commenting and rating int the last few months we are at a million a day.
The first day we put up comment in Yahoo New, we might sit there and say, well, who's gonna yell on the news? You know, that first morning, we had 85,000 comments. So people are very eager to interact with people. The inner action and then to the spirit of your question, which is how interact the Facebooks and real time information like Twitter and all the other gaming, all the other things that come. It is a combination of not in the walled garden so people can move around as they wish, gain feeds inside in a very integrated fashion inside yahoo properties like mail. We'll be introducing some things next month that I think are pretty exciting.
Okay.
So social's very important, plus, you know, kind of the ultimate in social is, in, in the right way, you found out more about people. And so hopefully we can start of a better experience. More about them in terms of filling a profile and doing things like that.
Correct.
So it's no walled garden. It's allowing interaction with the site and services. It's knowing more about them. What about, I think If I asked Facebook what is social they would begin and end with the social graph. And the idea is
Yeah, they'd say one name. Well the idea that people are connected to other people and other things, whether that's a brand or a place or is that compelling to you is that something that you feel Yahoo needs to partially own or own and you're comfortable not owning it? I don't know that anybody owns anything anymore.
Facebook could say I own it.
Yeah, but Facebook also shares it with it's, with his partners, so.
I think they rent it.
Depends on the agreement you have with them.
Yeah. So, it doesn't matter as long as you get, as long as you get your hands on the information and you can with the right intent, do something good for the user, so there's a better user experience.
Yeah.
That's good.
So access to that data. Exactly
It's important
Exactly
Owning it
Oh I'd love to own it. Shit, why not?
Right but it's
I'd love to You know, I'd like to be Queen Poobah of the world but I'm not. Get that laugh?
That was me. Scobel is right there. Have you ever met him? He's been disrupting. He trolled Charley Rose He was kind of slow, that probably wasn't heard. You guys are bad. In 2008. You've said that Jerry Yang first approached you to talk about the Yahoo job, at Cisco, Cisco you were meeting? A nd he said you know, Jerry you're not the right person for the job. That's right? Correct.
Are you the right person for the job?
Yeah, I'm one of many. I'm sure there were many people right for this job. But once I found out more about what it seemed Yang needed, I was one of them. But there's, there's, there's no one special person for any job. There's many people. That's the beauty of it. There's no one person that, as good as you are at interviewing people and you know, have a brain and can write. You gonna finish that? I feel like there's something coming of it. No but.
It already came.
You've asked, you've asked press, from day one actually, you've asked press and particular bloggers to give Yahoo a little space and, and maybe tone down this sort of advice of what should have happened and should happen. Any, that was from day one, and you've continued to do that. But on April 30th or right around there you, you Of this year or last year?
This year. This a good one, trip wanting caution. You made a statement that, you know, Google has some problems. Was only
Did you actually see that whole interview?
No I only read the part on a tech crunch
No, I hope, that is not what I said.
Yeah, they
If you actually see the interview I said that Google needs to grow a Yahoo every year.
Right.
Which just means they have to go into a lot of different businesses, that's why I said that isn't meant, that's not a slam that is a fact. I mean, to be, to be a 20 percent grower which is what they have to be interesting.
Yeah.
They have to grow a Yahoo, company the size of Yahoo every year.
Yeah.
That, there's nothing, I don't know why you though that was It wasn't just that, it was that you said they so reliant on It wasn't just that, it was that you said they so reliant on search advertising for their revenue, their only revenue stream I assume.
Well, is that wrong? I don't know if it's right, I mean, it's a correct statement, but is it such a bad trick to have if you're right arena.
No, of course not. It's a great trick, I have like that trick too with the social graph. That's not, but listen, you. I'm going to really argue with you on this one.
Great.
I said that they are 90 plus percent search. That's a fact. Yeah.
And to grow a Yahoo every year they're gonna have to grow other revenue streams. I mean, can we vote on that? I mean, I think that has to be true.
How about, you know. 'Cause search isn't growing that fast.
Let's dive into this like Coca-Cola, what percentage of their revenue streams are soft drinks or whatever they sell? Li ke one hundred percent right? Aren't most great companies single revenue companies?
No, no, no. Why did Coke go underwater? Why did Coke go into juices? Why did Coke go into diet drinks? Why, I mean... Okay. So if ...
I mean, why did GE, I mean, listen.
So you're saying You are saying more related products as opposed to a multinational holding incorporation of 35 different companies that know each other.
I'm not even saying a thing. I wasn't even commenting what they should do. It's not up to me to figure out what they should do. I'm just saying to grow a company the size of the Yahoo every year, when the search market isn't growing that fast. They have to do other things. And are you being a hypocrite by giving them advice when you've asked people not to give you advice? And I don't mean tha t to mince words or to try to get you. I'm just saying it like.
I wasn't giving them advice. They were asking me about me on Google and I wasn't, I mean, I called Eric Schmidt up. I have known him since..
Fair enough, if they look for your opinion I gave my opinion. Because if you listen to the interview and you can, they asked me my opinion.
Okay.
That was my I mean, you offer me your opinion all the time and you don't ask me.
By the way, I've never had a bong in my life, if that means anything to you.
I wasn't being literal. I wasn't actually suggesting you were smoking marijuana when you said the things you said. Not at all. In no way was I suggesting that. I'm sorry if that was confusing, I'm sorry I mothered her, I didn't mean that at all. Let's go back, let's go back to the product, and I'm just saying what I'm thinking here.
The products. The product discussion, there's a, you , you and Yahoo talks a lot about we're doing interesting things, we want to do interesting, interesting things with social. We want to do interesting, interesting things with mobile. We want, we're an exciting, we're an exciting technology company. But the actual moves I see, the hiring of Blake, his experiences in advertising and products. The things that you are doing, like partnering with Match.com, unloading jobs. other moves, with the exception of associated content, which we're gonna talk about in 12 but it seems as what you're doing is, you'd be a really good financial manager. Recognizing weaknesses, shoring up holes, growing where you need to, a lot of financial engineering, the company is healthy financially, stock prices are up quite a bit since. Are you, is all the stuff about, you know, we really wanna be a cutting edge technology company, is it kind of BS.
So.
And is it just to like recruit engineers and kinda keep the excitement going?
So Mike, since you were the one that brought up Jaws earlier I am going to continue that analogy. Steve came back into Apple in 1997. A company he knew very well, since he founded it.
Yeah. The iPod came out four years later, four years later. Three years after that is the first time his market cap grew at all, seven years. I've been at this company 15, 16 months. Okay.
And so I'm supposed to have an iPad, and iPod, an i I mean, come one, I mean. You know, you are involved in a very tiny company.
Very tiny. And it probably takes a long time to even convince yourself what the hell to do. Something magical, that the fine people of Yahoo are supposed to do in this short time so fuck off. And that one I meant.
First time.
We're way over here.
We're way over.
End on a high!
The last question is, i s are you a search company or not? Half of our revenues and profits are from search. We have.
From search or from Microsoft? I mean, not yet, but.
Search!
Okay.
From search! Listen, t he fact that you can crawl the web, and index the web is a commodity, as far I'm concerned. That used to be what was so fat. Now it's how many data centers can you put in. It's a commodity. So, search innovation is done? It's commoditized?
The Alba part of search, sure you, you can crawl more sites, you can index more sites, you can crawl more often. That is a matter of networking and data centers. What you do when you receive the information and how you choose to add other information to it, display it, video. Imagine what people are asking versus the, the literal clicks which is what we've all put up with. T here's a lot of innovation happening there and that's what we're dealing with. We have hundreds of engineers working on this problem. We are in the search business. It, just as HP, DELL, chose to outsource the commodity called the chip.
Yeah.
And to put their engineering around the user experience, that's what we're doing. We are in the search business. It is, it will say Yahoo Search. It isn't Bing. You can't find Bing on the page except down on the bottom in little things about that big. And we're in the Yahoo search business. And we're going to make it as entertaining, as innovative, and as special for the people that come to Yahoo pages as anybody else's.
All right, thank you. You're welcome.
They'll never know what the Yahoo is.
Oh my God. What is Yahoo Mike? Yahoo.
Me?
No, do you want to answer? Go ahead.
I'd rather hear your answer first.
No, you go ahead. No, let's hear your answer first.
Listen, Yahoo's a great company that is very , very strong in content for its users, uses amazing technology to serve up what increasingly weakens the web of one. F or instance, on our today module in the front page every five minutes, we have 32,000 different variations of that module. So you don't even know what I am seeing. In fact we serve a million diffe rent front page modules a day. And that's just through content optimization, that's just the beginning.
Customize I've experienced.
...customized, because we know the things you in interested in, maybe you don't like entertainment, maybe you like a certain sports team, et cetera, et cetera, and our click-through rate went up twice. So the point is, people come to us to find out what's going on in the world in a very nice quick fashion, to do their communications through mail and messenger, check in on their teams. And we all know about Yahoo finance. It's a place where you can just get it together. OK.
It's collated for you, it's all the things that as you're moving, you can even get your social information there. But, you know, e verybody moves through many websites in a day. Yahoo is one they always stop at. OK. You had some news today that, you have partnered with match.com .
Uh-huh, that was one piece of news.
Yeah. And they are now powering your personals and you're moving your existing personal product to direct to that now.
Yes. Yes.
Why abandon such a large, a large property? Well, personals is something we, the company actually hasn't been focusing on that much for about 3 years and so to, to ramp it back up. We didn't think that actually in t he sweet spot of what we do. It's more, the same thing with HotJobs. I think, during the time when Yahoo bought, bought into both of those concepts was when the diversification seemed to be many kinds of services, instead of many kinds of content, whether it's our editorial content, our license content or now with associated user generated content.
So that people really can, especially as you get into the local part of your world, the long tail content. You really need to get that from the folks that are on on the ground there. So I gave an example the other day, I was trying to decide whether I should fly to Europe a couple of weeks ago with the cloud, you know. Not the kind of cloud we all talk about. and I checked in on YahoolFront Page and there w as an AP report, but it was 17 hours old. I FOUND 17 hour old volcano information. You know, I need real live Twitter like feeds. You know, content brought in by people there and at the airports and so forth, that's what Yahoo stands for. Personals was something off the side. Are there any other of the big yahoo properties that...?
No .
So that's it. We've now gotten rid of e verything that you're not focused on.
Right.
Everything that's left you're focused on. Right.
Okay.
What about this? I'm sorry, what was the other announcement today? It was a Nokia announcement. We did an announcement with Nokia, and they are going to be using our mail and messenger on all of their i nternet enabled handsets around the world, and we will use their map and navigation services on both mobile and PC. Are we getting feedback from Carol should have both of her mics on? Or are we good out there on audio? We're good. Okay.
How important is mobile to Yahoo! going forward? Oh, mobile is extremely important. You know, of the eighty-two thousand, eighty-two million, I'm sorry, internet mobile devices in the U.S., we're on 37 million of them with our CompStat and search, and so, we really attack the U.S. market. People don't think, they just don't think-
Yeah. -that's true, but it is.
And it's especially important in emerging, or new to the net folks, who come on through handsets. Yeah.
[unintelligible] So the very fact of the matter is, the first application most of the users in the emerging part of the world want to use is messenger, because that's how they communicate with people, their friends and so forth. So , getting messenger on the handset company that really, outside the U.S., is dominant, is really important to us.
Is that a signal, that you're partnering with NOKIA, is that a signal that you're very focused on emerging markets, lowering hand set That you didn't make announcements around higher end handsets.
W ell, we already have iPhone apps, we have rim apps, a nd our android staff will be coming out soon. So, no. It has nothing to do with that. It's just that outside of the U.S. the Hero phones are you know, the A through F phones, are still getting the dominate use. Still has to be internet enabled. But, doesn't matter. But, no this is just a way to broaden the platform.We're already have lines to the 100 oams , so whether it's the Samsungs, Nokias ...
Are there are a 100 oams?
Mm-hm. Oams and carriers, yeah.
OK. There are.
What phone do have?
What a disturbing number by the way, is that we're on like 23 hundred different handsets. I mean, it's like the old days of Unix, you know. All you're doing is pointing to different variants. What kind? I carry a Blackberry and an Iphone.
OK. No Android. No, IPhone. Hands down or up for Blackberry. Hands down, up for Android. Hands down, up for anything else.
I would like to spend a few minutes talking about your product
organization. I think that, you know, that we could talk about the financial help that Yahoo and you actually do and you I seem to be doing quite well. I would rather focus, and I think this audience is probably more interested in, is on what Yahoo is doing on a product prespective.
You made some changes in the organization and there have been some departures at the senior level, but we don't need to talk about those.
The new blood is Blakerman. Has he officially started, maybe a week ago.
Last Monday. OK, last Monday. And I, you know, I want to put this carefully, but is he the person who runs product at Yahoo now?
Absolutely. OK. Does he, is he, would you consider him a product czar? Is it through, is there a committee? Does he answer to you only? Just how does it work? When you guys sit around and talk about what Yahoo is, and is going to be at a high level. Is it his job to sort of quarter, is he quarterback? Is he, you can imagine how maybe a Steve Jobs acts within his own organization. I get the sense that Steve is in charge of product. Is he, is he that person?
Well, first of all, you know, you can't find any VP engineer, VP product anywhere that compares to Steve Jobs . So.
And I didn't mean to make that comparison.
Let's start with that as an unfair comparison. I have a Head of Labs, Prabhakar that reports to me, Blake reports to me. Under Blake there's three segments, our advertising products group, our audience products group and our platform group. we would have the largest private clouds in the world . So we do alot of count in up organizatio and platform. Audience, of course, is all of our audience based products. Then, advertising, as you can imagine,we serve up 10 billion ads a day. So, keeping out whole advertising business is enormous technical effort.
So, if there isn't a single strategy at Yahoo, is what your doing on the advertising audience platform side and what you are doing on audience.
I mean, for instance, I talked earlier about generating different on the fly thru bulk machince and editorial authorization.
The second thing that we are n the process of looking at and we are testing is optomizing page format on the fly. For instance, we know that, males have banner blindness and will actually look at ads in the lower left hand. Women like banners in the upper right hand corner. So, why should I say it nails her off. N ow that you say it, it makes more sense. Why would I ever wait, you know, the wrong position. He's so slow. You're on the page, okay why would you ever do that? And because the advertiser, you know, you don't get the click through, etc., etc., so you can optimize the page on the fly for you know teenager versus the mom whatever.
That's all great but what a bout, you know, when you think about Apple, they just launched the Ipad. They aren't really talking about I optimization is like it's the iPad it's culturally changing.
That's because that that's because the iPad is, you know, lets start with a ... let's have a couple of different concepts here. Ipad, they're a hardware company. And an apps company, and the iPad is just the natural revolution, evolution.
Sure.
Evolution of what they're doing. When we talk, its like these days in the valley if you're not coming out with a device or a plat form, then somehow your not innovating. To, to be able understand how what I'm describing works is a lot of science and it's a a lot of equations, and it's a lot machine learning.
Where's the soul?
Pardon me?
I get the science part of it. Where's the soul, the product soul? Is that, I mean. What I'm trying to understand is, is that Blake? Is Blake the, the or is he the chief scientist sort of analysing the data?
Chief scientist is Prabhakar. The product soul, the soul, listen there's not absentee jobs . Who's the products soul of a lot of other companies? It's a combination of smart people, Mike. Its not, you can't pin a company the size of Yahoo on one person's back. That doesn't make any sense.
Have you heard that you said that a combination of smart people. Have you heard the saying that a camel is a horse designed by committee?
I know that. You don't design. You don't necessarily design, but you implement by serveral people.
OK, great.
By the way, when I can just imagine there were a lot of different
there were a lot of different concepts brought up to Steve, if you want to stick with jobs.
Yeah.
I mean he doesn't sit there and say it's this and then go do it. A lot of concepts are brought forth; they're tried, they're tested, they're sent back. There are people involved.
Yeah.
It's naive to think there's not multiple people involved.
Yeah, fair enough. Okay.
Why Blake. His last job was at Pepperdine. He was a professor. Before that
he was at Microsoft.
x] He was a professior at Pepperdine because he took two years off from Microsoft.
Fair enough. In Microsoft he was with Windows Live platform.
He worked on Internet video conferencing, internet tone, mail messaging, and blogging. advertising platform.
Yep, and before that Xerox and Compaq. Is that the key, the advertising platform experience?
No male clamps advertising, internet. Yeah.
I mean that's, this is a, we're in a very new industry here. I would say most of these wonderful start ups that are shooting through here are because they have a technical background and they have a great idea they find somebody with the technical background, you know it like in the early days and Yahoo is 15 years old, you know one of the oldest, nobody knew what any of this stuff was who just came and, and and worked at it. Blake, considering all those words we talked about, advertising Internet pretty darn good fit and my style. How important is social to Yahoo? And what is social to you, what does that mean to you?
Well, back when the word social Social actually had a broad definition. In that, you are a social person which meant you liked to communicate with the people and you are outgoing.
So if you start with the fact that socialist communications, you can basically say Yahoo Finance Chat was the first social. Yeah.
So social's extremely important. When we finally put out commenting and rating int the last few months we are at a million a day.
The first day we put up comment in Yahoo New, we might sit there and say, well, who's gonna yell on the news? You know, that first morning, we had 85,000 comments. So people are very eager to interact with people. The inner action and then to the spirit of your question, which is how interact the Facebooks and real time information like Twitter and all the other gaming, all the other things that come. It is a combination of not in the walled garden so people can move around as they wish, gain feeds inside in a very integrated fashion inside yahoo properties like mail. We'll be introducing some things next month that I think are pretty exciting.
Okay.
So social's very important, plus, you know, kind of the ultimate in social is, in, in the right way, you found out more about people. And so hopefully we can start of a better experience. More about them in terms of filling a profile and doing things like that.
Correct.
So it's no walled garden. It's allowing interaction with the site and services. It's knowing more about them. What about, I think If I asked Facebook what is social they would begin and end with the social graph. And the idea is
Yeah, they'd say one name. Well the idea that people are connected to other people and other things, whether that's a brand or a place or is that compelling to you is that something that you feel Yahoo needs to partially own or own and you're comfortable not owning it? I don't know that anybody owns anything anymore.
Facebook could say I own it.
Yeah, but Facebook also shares it with it's, with his partners, so.
I think they rent it.
Depends on the agreement you have with them.
Yeah. So, it doesn't matter as long as you get, as long as you get your hands on the information and you can with the right intent, do something good for the user, so there's a better user experience.
Yeah.
That's good.
So access to that data. Exactly
It's important
Exactly
Owning it
Oh I'd love to own it. Shit, why not?
Right but it's
I'd love to You know, I'd like to be Queen Poobah of the world but I'm not. Get that laugh?
That was me. Scobel is right there. Have you ever met him? He's been disrupting. He trolled Charley Rose He was kind of slow, that probably wasn't heard. You guys are bad. In 2008. You've said that Jerry Yang first approached you to talk about the Yahoo job, at Cisco, Cisco you were meeting? A nd he said you know, Jerry you're not the right person for the job. That's right? Correct.
Are you the right person for the job?
Yeah, I'm one of many. I'm sure there were many people right for this job. But once I found out more about what it seemed Yang needed, I was one of them. But there's, there's, there's no one special person for any job. There's many people. That's the beauty of it. There's no one person that, as good as you are at interviewing people and you know, have a brain and can write. You gonna finish that? I feel like there's something coming of it. No but.
It already came.
You've asked, you've asked press, from day one actually, you've asked press and particular bloggers to give Yahoo a little space and, and maybe tone down this sort of advice of what should have happened and should happen. Any, that was from day one, and you've continued to do that. But on April 30th or right around there you, you Of this year or last year?
This year. This a good one, trip wanting caution. You made a statement that, you know, Google has some problems. Was only
Did you actually see that whole interview?
No I only read the part on a tech crunch
No, I hope, that is not what I said.
Yeah, they
If you actually see the interview I said that Google needs to grow a Yahoo every year.
Right.
Which just means they have to go into a lot of different businesses, that's why I said that isn't meant, that's not a slam that is a fact. I mean, to be, to be a 20 percent grower which is what they have to be interesting.
Yeah.
They have to grow a Yahoo, company the size of Yahoo every year.
Yeah.
That, there's nothing, I don't know why you though that was It wasn't just that, it was that you said they so reliant on It wasn't just that, it was that you said they so reliant on search advertising for their revenue, their only revenue stream I assume.
Well, is that wrong? I don't know if it's right, I mean, it's a correct statement, but is it such a bad trick to have if you're right arena.
No, of course not. It's a great trick, I have like that trick too with the social graph. That's not, but listen, you. I'm going to really argue with you on this one.
Great.
I said that they are 90 plus percent search. That's a fact. Yeah.
And to grow a Yahoo every year they're gonna have to grow other revenue streams. I mean, can we vote on that? I mean, I think that has to be true.
How about, you know. 'Cause search isn't growing that fast.
Let's dive into this like Coca-Cola, what percentage of their revenue streams are soft drinks or whatever they sell? Li ke one hundred percent right? Aren't most great companies single revenue companies?
No, no, no. Why did Coke go underwater? Why did Coke go into juices? Why did Coke go into diet drinks? Why, I mean... Okay. So if ...
I mean, why did GE, I mean, listen.
So you're saying You are saying more related products as opposed to a multinational holding incorporation of 35 different companies that know each other.
I'm not even saying a thing. I wasn't even commenting what they should do. It's not up to me to figure out what they should do. I'm just saying to grow a company the size of the Yahoo every year, when the search market isn't growing that fast. They have to do other things. And are you being a hypocrite by giving them advice when you've asked people not to give you advice? And I don't mean tha t to mince words or to try to get you. I'm just saying it like.
I wasn't giving them advice. They were asking me about me on Google and I wasn't, I mean, I called Eric Schmidt up. I have known him since..
Fair enough, if they look for your opinion I gave my opinion. Because if you listen to the interview and you can, they asked me my opinion.
Okay.
That was my I mean, you offer me your opinion all the time and you don't ask me.
By the way, I've never had a bong in my life, if that means anything to you.
I wasn't being literal. I wasn't actually suggesting you were smoking marijuana when you said the things you said. Not at all. In no way was I suggesting that. I'm sorry if that was confusing, I'm sorry I mothered her, I didn't mean that at all. Let's go back, let's go back to the product, and I'm just saying what I'm thinking here.
The products. The product discussion, there's a, you , you and Yahoo talks a lot about we're doing interesting things, we want to do interesting, interesting things with social. We want to do interesting, interesting things with mobile. We want, we're an exciting, we're an exciting technology company. But the actual moves I see, the hiring of Blake, his experiences in advertising and products. The things that you are doing, like partnering with Match.com, unloading jobs. other moves, with the exception of associated content, which we're gonna talk about in 12 but it seems as what you're doing is, you'd be a really good financial manager. Recognizing weaknesses, shoring up holes, growing where you need to, a lot of financial engineering, the company is healthy financially, stock prices are up quite a bit since. Are you, is all the stuff about, you know, we really wanna be a cutting edge technology company, is it kind of BS.
So.
And is it just to like recruit engineers and kinda keep the excitement going?
So Mike, since you were the one that brought up Jaws earlier I am going to continue that analogy. Steve came back into Apple in 1997. A company he knew very well, since he founded it.
Yeah. The iPod came out four years later, four years later. Three years after that is the first time his market cap grew at all, seven years. I've been at this company 15, 16 months. Okay.
And so I'm supposed to have an iPad, and iPod, an i I mean, come one, I mean. You know, you are involved in a very tiny company.
Very tiny. And it probably takes a long time to even convince yourself what the hell to do. Something magical, that the fine people of Yahoo are supposed to do in this short time so fuck off. And that one I meant.
First time.
We're way over here.
We're way over.
End on a high!
The last question is, i s are you a search company or not? Half of our revenues and profits are from search. We have.
From search or from Microsoft? I mean, not yet, but.
Search!
Okay.
From search! Listen, t he fact that you can crawl the web, and index the web is a commodity, as far I'm concerned. That used to be what was so fat. Now it's how many data centers can you put in. It's a commodity. So, search innovation is done? It's commoditized?
The Alba part of search, sure you, you can crawl more sites, you can index more sites, you can crawl more often. That is a matter of networking and data centers. What you do when you receive the information and how you choose to add other information to it, display it, video. Imagine what people are asking versus the, the literal clicks which is what we've all put up with. T here's a lot of innovation happening there and that's what we're dealing with. We have hundreds of engineers working on this problem. We are in the search business. It, just as HP, DELL, chose to outsource the commodity called the chip.
Yeah.
And to put their engineering around the user experience, that's what we're doing. We are in the search business. It is, it will say Yahoo Search. It isn't Bing. You can't find Bing on the page except down on the bottom in little things about that big. And we're in the Yahoo search business. And we're going to make it as entertaining, as innovative, and as special for the people that come to Yahoo pages as anybody else's.
All right, thank you. You're welcome.
I remember seeing this interview with Carol Bartz at TC Disrupt: NYC (above).
Arrington: What is Yahoo?
Bartz: What is Yahoo? Yahoo is a company that is very strong in content. It’s moving towards the web of one. We have 32,000 variations on our front page module. We serve a million of those a day. It’s all customized. Our click-through rate went up twice since we started customizing this. People come to check the things they like. “You can just get it together.” Yahoo is one site people always stop at.
And with that, I decided that Yahoo! would not succeed with Carol Bartz at the helm as CEO.
Mind you, I’m no management guru. This is my first time wearing the CEO hat, and I screw up a plenty. So take that as a strong qualifier to what I’m about to say…
The CEO must, first and foremost, define and communicate a clear vision of and for the company.
What is [insert company name]? If no one inside or outside the company can answer the question, then there’s a problem. And problems of that magnitude typically arise from the CEO.
I saw this same problem at Drop.io, the Brooklyn-based startup that shut down this week in an asset sale to Facebook.
For a while, Drop.io was one of the hottest startups in NYC.
But for the longest time, I had absolutely no idea what they did. Mind you, this is when I was living in New York and actively involved in the local startup scene. If anyone was in a position to understand what they did, it was I.
One night, I attended a crowdsourcing meetup at the Drop.io HQ. Drinking beer afterwards, I asked a Drop.io engineer: “Maybe this is a stupid question, but what exactly is Drop.io anyway? What do you guys actually do?”
“Well, Drop.io is a lot of things. We have a robust chat application. We do real-time file synchronization. We…” And he proceeded to list out 10 more seemingly unrelated features. I’m sure he understood his particular task, but there didn’t seem to be any theme or story that unified all the products & features into an actual company.
The New York VCs seemed to love Drop.io, to the tune of $10mil over 3 rounds of investment. Word on the street was that they really just loved Sam Lessin, the founder. Apparently so does Facebook, as Sam’s name was singled out in company press announcement.
I don’t really know Sam. I’m happy he found a place to park the company’s assets and hopefully get his investors their money back.
But it seems like Sam––as much as he is described as a genius and fawned over by the people who actually know him––failed on the marketing front. Not just externally, but internally too.
From what I could gather as an outsider, Drop.io was the limitless company, a product that did everything for everybody, or tried to, anyways…and because of that, after December 15, will end up doing nothing for no one.
This is no personal dig on Sam, mind you, as I’m sure he tried his best.
But a big part of being a CEO involves requires you to decide on a core message––your founding story––then go out and repeat it ad naseaum to everyone who will listen, including bloggers, customers, investors, random people at bars, prospective hires, etc.
It takes repetition for a message to stick, and that means you, as an entrepreneur, have to repeat yourself over & over again in a disciplined and uncreative manner. Uncreative repetition is not why you become an entrepreneur, but it’s necessary to success so long as you wear the CEO hat.
It’s like being a political candidate: You have to go out and give the same damn speech time and time again. And if you want people to believe in you, you gotta do it with gusto. It ain’t easy, and it takes a special temperament to do it.
If you don’t? Well, then no one knows who you are or why you exist. And if they don’t know that, they won’t believe in you or your hallucination, they won’t part with their money, they won’t join your company, they won’t follow you down the dark hole of unknown that is being a startup. They won’t care.
And you fail, selling scraps of the dream, piece by piece, to the highest bidder, if anyone bids at all.
